Sigler v. Sigler

905 N.W.2d 308

Theresa SIGLER, Plaintiff and Appellant,

v.Arron SIGLER, Defendant and Appellee.

28057

Supreme Court of South Dakota.

CONSIDERED ON BRIEFS ON AUGUST 28, 2017

OPINION FILED December 13, 2017

PATRICIA A. MEYERS, Rapid City, South Dakota, Attorney for plaintiff and appellant.

ROBERT J. GALBRAITH of Nooney & Solay, LLP, Rapid City, South Dakota Attorneys for defendant and appellee.

KERN, Justice

[¶1.] At the time of their divorce in May 2011, Arron and Theresa Sigler stipulated that Theresa would have primary physical custody of their child T.S. In March 2016, Arron filed a motion for joint custody of T.S., a visitation schedule, and a shared parenting child support cross-credit under SDCL 25-7-6.27. The circuit court granted Arron joint custody and the cross-credit because T.S. resided with Arron seven out of every fourteen days. In making this decision, the court found that application of the cross-credit would not have a "substantial negative effect" on T.S.'s standard of living and that Theresa's budget showed she lived beyond her means. The circuit court reduced Arron's net monthly child support payment from $442 per month to $25 per month. Theresa appeals, arguing the circuit court made erroneous findings of fact and abused its discretion by granting the cross-credit. We reverse and remand for further proceedings.

Facts and Procedural History

[¶2.] On May 31, 2011, Theresa and Arron Sigler divorced. The parties had three children¹ and agreed by stipulation that primary physical custody of J.S. (born October 1, 1999) would go to Arron and Theresa would take primary physical custody of T.S. (born March 5, 2004). The court ordered Arron pay $361 per month in child support to Theresa.

[¶3.] Following the divorce, Theresa had another child, J.F. J.F.'s father is obligated to pay $630 in child support payments per month but is more than $11,000 in arrears. On January 23, 2015, Theresa filed a petition to modify child support, and on February 27, 2015, the parties appeared telephonically before the court-appointed referee Lee Ann Pierce (Referee) for hearing on the petition. Theresa sought an upward deviation due to costs associated with raising J.F., who was then seventeen months old. In response, Arron requested a downward deviation of his child support obligation, citing the fact that T.S. now resided with him approximately 50% of the time.

The Referee determined that "[c]ircumstances [had] changed substantially since the entry of the previous order in that the parties' incomes [had] changed." In analyzing whether to deviate downward from that number, the Referee examined the gross incomes and respective financial conditions of the parties. Arron earned approximately $83,911 per year with an adjusted monthly gross income of $4,600 and contributed $490 per month toward his retirement accounts. Theresa earned approximately $25,980 per year with an adjusted monthly gross income of $1,789, and she made no contributions toward retirement. The Referee found that the parties' combined adjusted gross income totaled $6,389, with Theresa contributing 28% and Arron contributing 72%. The Referee identified that two children were to be supported and that the child support obligation of the parties for each child was $1,068.

[¶5.] The Referee then calculated that Theresa should pay $299 per month in child support for J.S. based on her 28% share and that Arron should pay $769 per month in child support for T.S. based on his 72% share. The Referee declined to deviate upward despite Theresa having another child, J.F., in her care. Likewise, the Referee declined to deviate downward even though T.S. spent approximately seven out of every fourteen nights with Arron. The Referee also considered the parties' disparate incomes. Pursuant to SDCL 25-7-6.16, the Referee credited Arron with $28 of Theresa's pro rata share of the cost of the children's health insurance, leaving Arron with an obligation of $442 per month. Arron appealed the Referee's decision to the circuit court. On June 8, 2015, the circuit court affirmed, adopting the Referee's findings of fact and conclusions of law.

[¶6.] On March 27, 2016, Arron filed a motion for change of child custody, support, and visitation. Arron sought to formalize the parties' arrangement because at the time of the motion, T.S. divided her time equally between her parents. Arron requested that the circuit court order a shared-parenting custody arrangement and apply a shared parenting child support cross-credit under SDCL 25-7-6.27, which provides in part:

If a custody order by the court, contains a detailed shared parenting plan which provides that the child will reside no less than one hundred eighty nights per calendar year in each parent's home, and that the parents will share the duties and responsibilities of parenting the child and the expenses of the child in proportion to their incomes, the court may, if deemed appropriate under the circumstances, grant a cross credit on the amount of the child support obligation based on the number of nights the child resides with each parent. ...

....

In deciding whether a shared parenting child support cross credit is appropriate, the court shall consider whether it would have a substantial negative effect on the child's standard of living .

(Emphasis added).

[¶7.] The motion was heard on October 14, 2016, before a different circuit judge, who took the case on reassignment. At the hearing, the parties testified and introduced exhibits detailing their financial situations. Theresa introduced Exhibit A, which listed her monthly expenses totaling $2,989.68 and balances still owed to creditors, including: $2,000 for her dental care; $791 in clothing items from Kohl's primarily for T.S.; $1,900 in medical bills; $1,501 in orthodontic bills for T.S.; and $600 for a new dryer from Sears. Theresa attributed $350 of her budget to daycare expenses for J.F. Exhibit 4 listed the adjusted monthly gross incomes of the parties, which had not changed since the Referee's report in 2015. Theresa testified that she made up the more than $1,000-per-month shortfall by borrowing from her line of credit and paying off the line with her yearly tax return refund.

[¶8.] At the conclusion of the hearing, the circuit court asked the parties whether they wished to submit proposed findings of fact and conclusions of law. The parties agreed to do so and set October 28 as the deadline for simultaneous submission of their proposals. On October 28, Arron submitted his proposed findings of fact and conclusions of law. On November 8, Arron wrote to the circuit court to indicate that Theresa had neither submitted proposals of her own nor objected to Arron's. On November 10, Theresa submitted her proposals.

[¶9.] On November 14, 2016, the circuit court issued its findings of fact and conclusions of law. The court, in a letter to the parties' counsel, indicated that its findings of fact and conclusions of law "were entered not as a default/waiver but on the merits." The court, in its findings of fact, acknowledged that "[t]here has been no substantive change in either parties' [sic] income calculations since the Report of [the] Referee on March 4, 2015." Nevertheless, in its conclusions of law, the court allowed Arron a child support cross-credit and ordered joint physical custody of T.S. In so doing, the court reduced Arron's child support payment to Theresa from $442 per month to $25 per month. The court concluded that "[i]t is beyond any deviation [the circuit court] could allow to require [Arron] to pay $769.00 per month for a child who resides with him 182.5 days each year." The court further found that "[e]ven without incurring any costs for the care of [T.S.], [Theresa] lives beyond her means." The court highlighted Theresa's testimony that she could only maintain her current standard of living if she obtained additional employment. The court held that doing so would not have a substantial negative effect on T.S.'s standard of living and granted Arron's motion.

[¶10.] Theresa appeals, arguing the circuit court made erroneous factual findings and abused its discretion by applying the shared parenting cross-credit in this case.

Analysis and Decision

[¶11.] We review the decision to modify a child support obligation for an abuse of discretion. See Kauth v. Bartlett , 2008 S.D. 20, ¶ 8, 746 N.W.2d 747, 750. "An abuse of discretion is a ‘discretion exercised to an end or purpose not justified by, and clearly against, reason and evidence.’ " Schieffer v. Schieffer , 2013 S.D. 11, ¶ 14, 826 N.W.2d 627, 633 (quoting Hill v. Hill , 2009 S.D. 18, ¶ 5, 763 N.W.2d 818, 822 ). Findings of fact are reviewed for clear error. Id. ¶ 15. "As a result, this Court ‘will overturn the [circuit] court's findings of fact on appeal only when a complete review of the evidence leaves this Court with a definite and firm conviction that a mistake has been made.’ " Id. (quoting Kreps v. Kreps , 2010 S.D. 12, ¶ 25, 778 N.W.2d 835, 843 ).²

[¶12.] Theresa argues that even if we accept the circuit court's factual findings, they fail to support the circuit court's decision to apply the cross-credit. Specifically, Theresa contends that application of the cross-credit will have a "substantial negative effect on the child's standard of living." See SDCL 25-7-6.27. Theresa argues that T.S.'s basic standard of living will decline under such an arrangement. In support of this contention, Theresa cites Ochs v. Nelson , 538 N.W.2d 527 (S.D. 1995), and Schieffer , 2013 S.D. 11, ¶ 48, 826 N.W.2d at 643.³

[¶13.] Ochs concerned parents with disproportionate standards of living. The mother earned $12,681 per year while the father's average annual salary was $62,345. Ochs , 538 N.W.2d at 528. Additionally, the father possessed an 80% interest in a corporation with an "average yearly net income over the last three years [of] $116,905" and "had accumulated retained earnings exceeding one-half million dollars." Id. Compared to the...